MSN India bullish on online users, advertising

MSN India is betting big on the online business in the country. Bullish on the growth of the Internet as a medium in India, and the growth of online advertising, MSN India is looking to cash in on the bandwagon. And as it’s base of over 12.5 million users across the country grows, it says it will engage in brand building measures through both offline and online avenues.

Speaking to exchange4media, Rajnish, Head of Marketing & Strategic Business Initiatives, who has been given additional charge as Head of Sales recently, said, “The Internet business is on the cusp of a very big boom in India. We’ve witnessed growth from 4 to 5 million users in 2000 to about 30 million users in 2005. Our forecast is that this number will go up to 110 million users by 2010, making India the country with the third largest number of Internet users.”

The optimism is furthered by forecasts of India becoming the third largest on number of mobiles, and fifth largest on broadband by 2010. The online ad industry has grown rapidly, he says, from revenues of two million dollar in 2000 to an estimated 16 to 20 million dollar now.

The spokesperson explained that with the international monetisation at between two and three dollar per online user, the worth of the medium in India would exceed 200 million dollar even at a modest conversion of two dollars per user. To substantiate, Rajnish lends a comparison to the overall advertising Industry in the country, which is slated to double by 2010.

“Even with Online’s share of advertising remaining at two to three per cent, it would grow past that figure. But we see it growing further,” he added. The company predicts that over time, seamless integration between the web and the mobile will happen, with the web becoming device independent.

Krishna Prasad, Head of Programming at MSN India, said that the industry will soon change from the current scenario. “Advertisers spend money based on reach and minutes spent. In the US, online has eaten into minutes and revenues of traditional media. As infrastructure improves (Broadband), TV will come in a lot. It will benefit the users as well as the advertisers,” he said. He added that the ad units themselves have evolved from the static ‘gifs’, and are set to enter new areas soon.

MSN is planning to increase initiatives on brand building, focused on the online medium and the cyber cafes, besides traditional media. The current statistic of 50 per cent of all Internet access being from the over 70,000 cyber cafes in the country is a reason for this. MSN believes that Cyber Cafes will continue to be the major point of Internet access. Said Rajnish, “The three pillars will be the Internet cafes, mobiles and broadband. There is a large chunk of people for whom the first experience of the Internet will be on their mobiles. We see a change in the present structure, but not a dramatic one. Cyber Cafes will remain a major chunk and they do double up with other sources of revenue.”

Cyber Café programmes that the company has started in Bangalore will enter Mumbai and Pune soon. The company plans to add three more cities for the programme. The spokesperson underscored that MSN will not just look at garnering its share of the ad pie, but also engage in giving users the tools and services that are relevant to them. This year, it has launched two services in India, the MSN search and the MSN 7 Messenger.